WFC Wells Fargo and Company

By Will Feuer

The Consumer Financial Protection Bureau said it is ordering Wells Fargo & Co. to pay about $3.7 billion in redress to consumers and penalties for "widespread mismanagement" that led to wrongful foreclosures on homes and illegal repossession of vehicles.

Wells Fargo must pay more than $2 billion in redress to affected consumers, the CFPB said, and a $1.7 billion civil penalty.

Shares of Wells Fargo fell 3%, to $40.60, in the premarket session.

"Wells Fargo's rinse-repeat cycle of violating the law has harmed millions of American families," CFPB Director Rohit Chopra said. "The CFPB is ordering Wells Fargo to refund billions of dollars to consumers across the country. This is an important initial step for accountability and long-term reform of this repeat offender."

The CFPB alleges that Wells Fargo incorrectly applied borrowers' payments on auto loans, improperly charged fees and interest, and wrongfully repossessed borrowers' vehicles. The bank also improperly denied thousands of mortgage-loan modifications, which in some cases led to Wells Fargo customers losing their homes to wrongful foreclosures, the CFPB said.

Wells Fargo also unfairly charged surprise overdraft fees, the CFPB said, and unlawfully froze consumer accounts and misrepresented fee waivers.

Write to Will Feuer at Will.Feuer@wsj.com

(END) Dow Jones Newswires

December 20, 2022 09:21 ET (14:21 GMT)

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